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As filed with the Securities and Exchange Commission on November 27, 1996
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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SIERRA PACIFIC POWER COMPANY
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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Nevada 88-0044418
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
P.O. Box 10100 (6100 Neil Road), Reno, Nevada 89520-0400, 702-689-4011
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
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WILLIAM E. PETERSON, ESQ.
Senior Vice President and General Counsel
Sierra Pacific Power Company
P.O. Box 10100 (6100 Neil Road)
Reno, Nevada 89520-0400
(702) 689-4011
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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Copies to:
WILLIAM C. ROGERS, ESQ. DAVID C. CHAPIN, ESQ.
Choate, Hall & Stewart Ropes & Gray
53 State Street One International Place
Boston, Massachusetts 02109 Boston, Massachusetts 02110
(617) 248-5000 (617) 951-7000
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Approximate date of commencement of proposed sale to the public:
From time to time or at one time after the effective date of this Registration
Statement.
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans, check the following
box. / /
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, check the following
box and list the Securities Act registration statement number of earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box. / /
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C A L C U L A T I O N O F R E G I S T R A T I O N F E E
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Proposed Proposed
Maximum Maximum
Title of each Class of Amount to Offering Aggregate Amount of
Securities to be be Price Offering Registration
Registered Registered Per Unit(1) Price(1) Fee
- --------------------------------------------------------------------------------
Collateralized Debt
Securities . . . . . $35,000,000 100% $35,000,000 $10,607
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(1) Exclusive of accrued interest, if any. Estimated solely for the
purpose of calculating the registration fee.
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The registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
PRELIMINARY PROSPECTUS DATED NOVEMBER 27, 1996
SUBJECT TO COMPLETION
$35,000,000
SIERRA PACIFIC POWER COMPANY
COLLATERALIZED DEBT SECURITIES
______________________
Sierra Pacific Power Company (the "Company") may offer from time to time its
collateralized debt securities consisting of notes or other evidences of
indebtedness (the "Debt Securities") in an initial principal amount of
$35,000,000. The Debt Securities may be offered as separate series or tranches
in amounts, at prices and on terms to be determined in light of market
conditions at the time of sale and set forth in one or more Prospectus
Supplements or a pricing supplement thereto.
The terms of each series or tranche of Debt Securities, including, where
applicable, the specific designation, aggregate principal amount, authorized
denominations, maturity date or dates, interest rate or rates (which may be
fixed or variable) and time or times of payment of any interest, any terms for
optional or mandatory redemption or payment of additional amounts or any sinking
fund provisions, any initial public offering price, the net proceeds to the
Company and any other specific terms in connection with the offering and sale of
such series or tranche (the "Offered Securities") will be set forth in one or
more Prospectus Supplements or a supplement thereto; provided, however, that in
no event shall the interest rate (whether fixed or variable) on any Debt
Securities exceed the 9% interest rate on the underlying Mortgage Bonds (as
defined below) relating thereto. As used herein, Debt Securities shall only
include securities denominated in United States dollars and will not be issued
or payable in foreign or composite currencies.
The Debt Securities will be secured by one or more series of first mortgage
bonds (the "Mortgage Bonds") to be issued and pledged by the Company to Bankers
Trust Company, acting as trustee (the "Trustee") under the indenture for the
Debt Securities. The aggregate principal amount of the Debt Securities
outstanding and the aggregate premium thereon, if any, will not exceed the
aggregate principal amount of Mortgage Bonds pledged to and held by the
Trustee. The Mortgage Bonds will bear interest at times and in amounts
sufficient to provide for the payment of interest on the Debt Securities, and
the Mortgage Bonds also will be redeemed at times and in amounts that correspond
to the required payments of principal of and any premium on the Debt Securities.
Payments on the Debt Securities will satisfy payment obligations on the
underlying Mortgage Bonds relating thereto. See "Description of Debt
Securities--Security; Pledge of Mortgage Bonds" and "Description of Mortgage
Bonds".
The Debt Securities may be sold directly by the Company, through agents
designated from time to time or to or through underwriters or dealers. See
"Plan of Distribution". If any agents of the Company or any underwriters are
involved in the sale of any Debt Securities in respect of which this Prospectus
is being delivered, the names of such agents or underwriters and any applicable
commissions or discounts will be set forth in a Prospectus Supplement. The net
proceeds to the Company from such a sale also will be set forth in a Prospectus
Supplement.
___________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
___________________
This Prospectus may not be used to consummate sales of Debt Securities
unless accompanied by a Prospectus Supplement.___________________
The date of this Prospectus is December ___, 1996
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports and other information with the Securities and Exchange
Commission (the "Commission"). Information regarding the Company's directors,
the remuneration paid to the Company's directors and officers, and interests of
management and others in certain transactions with the Company is disclosed in
reports filed by the Company with the Commission. The Company's parent, Sierra
Pacific Resources, is also subject to the informational requirements of the
Exchange Act and, in accordance therewith, files reports, proxy statements and
other information with the Commission. Such reports, proxy statements and other
information filed with the Commission can be inspected and copied at the public
reference facilities maintained by the Commission at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the Commission's regional offices
at 7 World Trade Center, 13th Floor, New York, New York 10048, and 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such material
can be obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549 at prescribed rates. The Commission also
maintains a Web site that contains reports, proxy and information statements and
other information regarding registrants that file electronically with the
Commission (http://www.sec.gov). This Prospectus does not contain all the
information set forth in the Registration Statement and exhibits thereto which
the Company has filed with the Commission under the Securities Act of 1933, as
amended (the "Act"), and to which reference is hereby made.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission pursuant to
the Exchange Act are incorporated by reference in this Prospectus and made a
part hereof:
1. The Company's Annual Report on Form 10-K for the year ended December
31, 1995, including the Form 10-K/A amendment thereto;
2. The Company's Quarterly Reports on Form 10-Q for the quarterly periods
ended March 31, 1996, June 30, 1996 and September 30, 1996; and
3. The Company's Current Reports on Form 8-K dated July 3, 1996
(relating to the termination of the Company's merger with The Washington
Water Power Company), dated August 2, 1996 (relating to the issuance of trust
originated preferred securities) and dated November 20, 1996, including the
Form 8-K/A amendment thereto (relating to the appointment of Deloitte &
Touche, L.L.P. as the Company's independent accountants).
All documents filed by the Company with the Commission pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus
and prior to the termination of this offering shall be deemed to be incorporated
by reference in this Prospectus and to be a part hereof from the date of filing
of such documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference in this Prospectus shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained in this Prospectus or in any other
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subsequently filed document which also is or is deemed to be incorporated by
reference in this Prospectus modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom a copy of this Prospectus has been delivered, upon the
written or oral request of such person, a copy of any or all of the documents
which are incorporated by reference in this Prospectus, other than exhibits to
such documents (unless such exhibits are specifically incorporated by reference
into such documents). Requests for such copies should be directed to Treasurer,
Sierra Pacific Power Company, P.O. Box 10100, Reno, Nevada 89520-0400,
telephone (702) 689-4011.
THE COMPANY
The Company is a public utility company which is engaged primarily in the
generation, purchase, transmission, distribution and sale of electric energy to
approximately 270,000 customers in a service territory of approximately 50,000
square miles located in western, central and northeastern Nevada, including the
cities of Reno, Sparks, Carson City and Elko, and eastern California, including
the Lake Tahoe area. The Company met its electric energy requirements for the
twelve months ended December 31, 1995 by utilizing coal generation (23%),
gas/oil generation (30%), purchased power (46%) and hydro power (1%). The
Company has no ownership interest in, nor does it operate, any nuclear
generating units and has no future plans to do so. The Company also provides
gas and water service to approximately 92,000 gas and 61,000 water customers in
the cities of Reno and Sparks and environs. No material part of any of the
Company's business segments is dependent upon a single customer.
The Company is a subsidiary of Sierra Pacific Resources ("Resources"),
which owns all of the Company's outstanding common stock. In June, 1994, the
Company, Resources, and The Washington Water Power Company ("WWP") entered
into an Agreement and Plan of Reorganization and Merger, as subsequently
amended (the "Merger Agreement"), which provided for the merger of the
Company, Resources and WWP into Altus Corporation ("Altus"). WWP is a
combined electric and gas utility, with headquarters in Spokane, Washington.
Although the parties to the merger had received all of the necessary
approvals from their respective shareholders, the merger was still under
review by the Federal Energy Regulatory Commission when, on June 28, 1996,
WWP notified Resources and the Company that it was terminating the Merger
Agreement in accordance with its terms. As a result of the termination of
the Merger Agreement, the Company is continuing to operate as a separate
utility.
The principal executive offices of the Company are located at 6100 Neil Road
(P.O. Box 10100), Reno, Nevada 89520-0400, telephone (702) 689-4011.
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APPLICATION OF PROCEEDS
The net proceeds from the sale of the Debt Securities offered hereby will be
used for general corporate purposes including, but not limited to, the
acquisition of property, the construction, completion, extension or improvement
of facilities, or the refinancing or discharge or refunding of obligations,
including short-term borrowings. Pending the uses described above, the proceeds
from the sale of the Debt Securities offered hereby will be invested in short-
term investments.
RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratios of earnings to fixed charges of the
Company for each of the years 1991 through 1995 and the twelve months ended
September 30, 1996.
Year Ended December 31,
------------------------------------------- Twelve Months
Ended
September 30,
1991 1992 1993 1994 1995 1996
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2.62 2.81 2.94 3.09 3.54
For the purpose of computing the Company's ratios of earnings to fixed
charges, "earnings" represent the aggregate of net income, taxes on income and
fixed charges. The Company's earnings used in the calculation of the ratios of
earnings to fixed charges include the allowance for funds used during
construction. "Fixed charges" represent interest on short-term and long-term
debt, the interest portion on capital leases and amortization of bond premiums,
discounts and expenses, excluding amortization of the net gain or loss on
reacquired mortgage bonds.
DESCRIPTION OF DEBT SECURITIES
The Debt Securities will be issued under the Collateral Trust Indenture,
dated as of June 1, 1992, as supplemented in connection with the issuance and
sale of the Debt Securities (the "Indenture"), between the Company and Bankers
Trust Company, in its capacity as Trustee, which Indenture is an exhibit to the
Registration Statement of which this Prospectus is a part. The statements under
this caption are summaries of certain provisions of the Indenture, do not
purport to be complete and are subject to, and are qualified in their entirety
by reference to, all of the provisions of the Indenture, including the
definitions therein of certain terms. Wherever particular sections of the
Indenture or terms that are defined in the Indenture are referred to herein or
in a Prospectus Supplement, it is intended that such sections or defined terms
shall be incorporated by reference herein or therein, as the case may be.
The term "Securities", as used under this caption, refers to all Securities
issued under the Indenture and includes the Debt Securities. Unless the context
otherwise requires, the term "series or tranche" as used in this Prospectus
means, with respect to each series of Securities, such series or, if one or more
tranches have been issued within such series, a tranche.
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GENERAL
The Debt Securities may be issued from time to time in one or more series
and in one or more tranches. The particular terms of each series or tranche of
Debt Securities will be described in one or more Prospectus Supplements, or a
pricing supplement thereto, relating to such series or tranche.
The Indenture does not limit the aggregate amount of Securities that may be
issued thereunder, and Securities may be issued thereunder from time to time in
separate series up to the aggregate amount from time to time authorized by the
Company for each series. For a description of the security for the Securities,
see "Security; Pledge of Mortgage Bonds" below and "Description of Mortgage
Bonds".
The applicable Prospectus Supplement, or a pricing supplement thereto, will
describe the following terms of the Offered Securities: (1) the title of the
Offered Securities; (2) any limit on the aggregate principal amount of the
Offered Securities; (3) the date or dates on which the Offered Securities will
mature; (4) the rate or rates at which the Offered Securities will bear
interest, if any, or the formula pursuant to which such rate or rates will be
determined, and the date or dates from which any such interest will accrue;
provided that in no event shall the interest rate (whether fixed or variable) on
the Offered Securities exceed the 9% interest rate on the underlying Mortgage
Bonds relating thereto; (5) the Interest Payment Dates on which any such
interest on the Offered Securities will be payable and the Regular Record Date
for any interest payable on any Offered Securities on any Interest Payment Date;
(6) the person to whom any interest on any Registered Security of the series
will be payable if other than the person in whose name such Registered Security
is registered at the close of business on the Regular Record Date for such
interest as described under "Payment and Paying Agents" below; (7) any mandatory
or optional sinking fund, redemption or analogous provisions; (8) each office or
agency where, subject to the terms of the Indenture as described below under
"Payment and Paying Agents", the principal of (and premium, if any) and interest
on the Offered Securities will be payable and each office or agency where,
subject to the terms of the Indenture as described below under "Form, Exchange,
Registration and Transfer", the Offered Securities may be presented for
registration of transfer or exchange; (9) the date, if any, after which, and the
price or prices at which, the Offered Securities may be redeemed, in whole or in
part at the option of the Company, or pursuant to mandatory redemption
provisions, and the other detailed terms and provisions of any such optional or
mandatory redemption provisions; (10) the denominations in which any Offered
Securities will be issuable, if other than denominations of $1,000 and any
integral multiple thereof; (11) any index or indices used to determine the
amount of payments of principal of (and premium, if any) and interest on the
Offered Securities; (12) the portion of the principal amount of the Offered
Securities, if other than the entire principal amount thereof, payable upon
acceleration of maturity thereof; (13) the Person who shall be the Security
Registrar for Offered Securities; (14) any deletions or modifications of or
additions to the Events of Default or covenants set forth in the Indenture;
(15) any Paying Agent or Authenticating Agent; (16) whether the Securities of
the series shall be issued in whole or in part in the form of one or more Global
Security or book-entry security or securities and, if so, the depositary for
such Global Security or book-entry security or securities; (17) the Mortgage
Bonds (or additional Mortgage Bonds) granted to secure the Offered Securities of
the series or tranche, and the designation of the portion of the Mortgage Bonds
which shall be Designated Mortgage Bonds (as defined below); (18) any defeasance
provisions applicable to
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the Offered Securities of the series or tranche; and (19) any other terms of the
series or tranche (which terms shall not be inconsistent with the provisions of
the Indenture). (Section 301)
Securities may be issued as Original Issue Discount Securities to be sold
at a discount below their principal amount. Special United States federal
income tax considerations applicable to Securities issued at an original issue
discount, including Original Issue Discount Securities, are described under
"Certain United States Federal Income Tax Consequences - Original Issue
Discount". The applicable Prospectus Supplement, or a pricing supplement
thereto, will provide additional information regarding the original issue
discount aspects of such Securities.
SECURITY; PLEDGE OF MORTGAGE BONDS
GENERAL. In order to secure by the lien of the Mortgage Indenture (as
defined below) the obligation of the Company to pay the principal of (and
premium, if any) and interest on any series or tranche of the Securities, the
Company will issue, pledge and deliver to the Trustee, in trust for the ratable
benefit of the Holders of such series or tranches, Mortgage Bonds, which
Mortgage Bonds will be issued pursuant to that certain Indenture of Mortgage,
dated as of December 1, 1940 (the "Mortgage Indenture"), between the Company and
The New England Trust Company (State Street Bank and Trust Company, as successor
trustee) and Leo W. Huegle (Gerald R. Wheeler, as successor trustee) (the
"Mortgage Trustees"). (Section 401(a)) The aggregate principal amount of the
Securities outstanding and maximum aggregate amount of premium thereon, if any,
will not exceed the aggregate principal amount of Mortgage Bonds pledged with
and held by the Trustee. The Mortgage Bonds will bear interest at times and in
amounts sufficient to provide for the payment of interest on the Securities and
also will be redeemed at times and in amounts that correspond to the required
payments of principal of and any premium on the Securities. Payments on the
Securities will satisfy payment obligations on the underlying Mortgage Bonds
relating thereto. The Mortgage Bonds will be secured by a first mortgage lien
on certain property owned by the Company and will rank on a parity with all
other first mortgage bonds of the Company. As of September 30, 1996, the
Company had outstanding $___ million aggregate principal amount of first
mortgage bonds. See "Description of Mortgage Bonds".
PLEDGE OF MORTGAGE BONDS. The Company will from time to time issue and
deliver to and pledge with the Trustee, for the benefit of the Holders of each
series or tranche of the Securities, Mortgage Bonds in an aggregate principal
amount such that the aggregate principal amount of Mortgage Bonds then being
delivered to the Trustee pursuant to the Indenture is equal to or greater than
the aggregate principal amount (or, in the case of Original Issue Discount
Securities, the aggregate principal amount thereof due and payable at the Stated
Maturity thereof) of, plus the maximum aggregate amount of any premium on, the
series or tranche of Securities then being delivered to the Trustee or an
Authenticating Agent for authentication pursuant to the Indenture. Such pledge
becomes effective upon issuance of such series or tranche and satisfaction of
other conditions and is effective to the extent the amounts to be payable on
such Mortgage Bonds do not exceed the amounts stated to be payable on such
Securities. (Section 401)
The Indenture provides that the Company will not issue and deliver
Securities of any series or tranche to the Trustee or an Authenticating Agent
for authentication, and the Trustee
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or such Authenticating Agent will not authenticate Securities of any series,
unless the Company has delivered to the Trustee or such Authenticating Agent a
Company Order, pursuant to which the Company designates with respect to such
series or tranche Designated Mortgage Bonds, which designation, subject to
certain provisions relating to the surrender of the Designated Mortgage Bonds,
shall remain in effect to the extent that the series or tranche of Securities
with respect to which the Designated Mortgage Bonds have been so designated
remain outstanding. (Section 401(d)) For purposes of the foregoing,
"Designated Mortgage Bonds", with respect to any series or tranche of
Securities, means an aggregate principal amount of Mortgage Bonds held by (or
then being delivered to) and pledged with the Trustee, not designated at the
time with respect to Outstanding Securities, equal to the aggregate principal
amount (or, in the case of Original Issue Discount Securities, the aggregate
principal amount thereof due and payable at the Stated Maturity thereof) of,
plus the maximum aggregate amount of any premium on, the Securities of such
series or tranche issued and delivered by the Company to the Trustees or an
Authenticating Agent for authentication pursuant to the Indenture.
If at any time the principal, premium if any and interest due on any
Security is paid in full, the principal of a corresponding amount of the
Designated Mortgage Bonds designated in connection with the issue of such
Security shall cease to be a Designated Mortgage Bond.
SATISFACTION OF PAYMENT OBLIGATION ON MORTGAGE BONDS. The interest rate on
each series of Mortgage Bonds will be as specified in the applicable Prospectus
Supplement or a pricing supplement thereto. The Indenture provides that the
obligation of the Company to make any payment of the principal of (and premium,
if any) or interest on the Designated Mortgage Bonds will be deemed to have been
satisfied and discharged to the extent that at the time any such payment shall
be due, the then due principal of (and premium, if any) or interest on the
Securities to which such Designated Mortgage Bonds relate, shall have been paid,
deemed to have been paid or otherwise satisfied and discharged. In addition,
such obligation to make any payment of the principal of (and premium, if any) or
interest on the Designated Mortgage Bonds at any time shall be deemed to have
been satisfied and discharged to the extent that the amount of the Company's
obligation to make any payment of the principal of (and premium, if any) or
interest on the Designated Mortgage Bonds exceeds the obligation of the Company
at that time to make any payment on the applicable Redemption Date or Stated
Maturity of the principal of (and premium, if any) or interest on the Securities
to which such Designated Mortgage Bonds relate. The obligation of the Company
to make any payment of the principal of (and premium, if any) or interest on the
Mortgage Bonds other than Designated Mortgage Bonds shall be deemed to have been
satisfied and discharged in full at the time any such payment shall be stated to
be due. (Section 403(a))
REDEMPTION OF MORTGAGE BONDS. The Company covenants and agrees in the
Indenture that upon the required payment of principal or premium, if any,
becoming due and payable with respect to any Securities upon Stated Maturity or
redemption, it will redeem the Designated Mortgage Bonds relating to such
Securities in an aggregate principal amount equal to the amount becoming due and
payable on such Securities, plus accrued interest; provided, however, that the
Company's obligation to redeem such Designated Mortgage Bonds will be deemed to
have been satisfied and discharged to the extent that at the time any such
payment shall be due, the then due aggregate principal amount of the Securities
to which such Designated Mortgage Bonds relate, plus the aggregate amount of any
premium on, or
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accrued interest to the redemption date for, such Securities shall have been
paid, deemed to have been paid or otherwise satisfied and discharged. Except
for such redemption and any redemption required under the Mortgage Indenture in
the event that all or substantially all of the electric properties of the
Company are sold to or taken through the exercise of the right of eminent domain
or the right to purchase by any municipal or governmental body or agency, the
Company covenants that it will not redeem the Mortgage Bonds or take any action
that will result in the Mortgage Indenture Trustees incurring an obligation to
redeem any Mortgage Bonds. (Section 404)
The Trustee will, upon request of the Company, surrender to the Mortgage
Trustees for cancellation Mortgage Bonds in an aggregate principal amount equal
to the aggregate principal amount of any other Mortgage Bonds delivered to and
pledged with the Trustee pursuant to the Indenture in exchange therefor;
provided that the Mortgage Bonds so delivered to and pledged with the Trustee
(a) contain no provisions that would impair the benefit of the lien of the
Mortgage Indenture in favor of the holders of the Outstanding Securities, and
(b) have the same terms as the Mortgage Bonds so surrendered. (Section 406(b))
From time to time upon request of the Company, the Trustee will surrender
to the Mortgage Trustees for cancellation Mortgage Bonds other than Designated
Mortgage Bonds held by the Trustee pursuant to the Indenture. (Section 406(c))
FORM, EXCHANGE, REGISTRATION AND TRANSFER
The Securities will be issuable only in fully registered form. Securities
of a series or tranche may be represented, in whole or in part, by one or more
permanent Global Securities in a denomination or aggregate denominations equal
to the portion of the aggregate principal amount of Outstanding Securities of
the series or tranche to be represented by such Global Security or Securities.
Any such Global Security deposited with a Depositary or its nominee identified
in the applicable Prospectus Supplement or pricing supplement thereto and
bearing the legend required by the Indenture may not be surrendered for
registration of transfer or for exchange except by the Depositary for such
Global Security or any nominee of such Depositary, except if the Depositary
notifies the Company that it is unwilling or unable to continue as Depositary,
or the Depositary ceases to be qualified as required by the Indenture, or the
Company instructs the Trustee in accordance with the Indenture that such Global
Security shall be so registrable and exchangeable, or there shall have occurred
and be continuing an Event of Default with respect to the Securities evidenced
by such Global Security, or there shall exist such other circumstances, if any,
as may be specified in the applicable Prospectus Supplement. (Sections 203,
204, 301 and 305)
The specific terms of the depository arrangement with respect to any
portion of a series or tranche of Securities to be represented by one or more
Global Securities will be described in the applicable Prospectus Supplement or
pricing supplement thereto. Beneficial interests in Global Securities will only
be evidenced by, and transfers thereof will only be effected through, records
maintained by the Depositary and the institutions that are participants in the
Depositary.
At the option of the Holder, subject to the terms of the Indenture and the
limitations applicable to Global Securities, Securities of any series or tranche
will be exchangeable for
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other Securities of the same series of any authorized denominations and of a
like aggregate principal amount and tenor. (Section 305)
Securities may be presented for exchange as provided above and for
registration of transfer (with the form of transfer endorsed thereon duly
executed), at the office of the Trustee or at the office of any transfer agent
designated by the Company for such purpose with respect to any tranche or series
of Securities and referred to in an applicable Prospectus Supplement or pricing
supplement thereto, without service charge and upon payment of any taxes and
other governmental charges as described in the Indenture. Such transfer or
exchange will be effected upon the Trustee or such transfer agent, as the case
may be, being satisfied with the documents of title and identity of the person
making the request. If a Prospectus Supplement or pricing supplement thereto
refers to any transfer agents (in addition to the Trustee) initially designated
by the Company with respect to any series or tranche of Securities, the Company
may at any time rescind the designation of any such transfer agent or approve a
change in the location through which any such transfer agent (or Trustee) acts.
The Company may at any time designate additional transfer agents with respect to
any series or tranche of Securities. (Sections 305 and 1102)
The Company shall not be required to: (i) issue, register the transfer
of or exchange Securities of any series or tranche during a period beginning
at the opening of business 15 days before any selection of Securities of that
series or tranche to be redeemed and ending at the close of business on the
day of mailing of the relevant notice of redemption or (ii) register the
transfer of or exchange any Security, or portion thereof, called for
redemption, except the unredeemed portion of any Security being redeemed in
part. (Section 305)
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in an applicable Prospectus Supplement or a
pricing supplement thereto, payment of principal of (and premium, if any) and
interest on Securities will be made at the office of the Trustee, except that at
the option of the Company payment of any interest may be made by check mailed to
the address of the Person entitled thereto as such address shall appear in the
Security Register. If any interest payment is to be made by wire transfer, the
Trustee must receive wire payment instructions from the holder by the Regular
Record Date for such interest payment. Unless otherwise indicated in an
applicable Prospectus Supplement or a pricing supplement thereto, payment of any
installment of interest on Securities will be made to the Person in whose name
such Security is registered at the close of business on the Regular Record Date
for such interest. (Sections 301 and 307)
Unless otherwise indicated in an applicable Prospectus Supplement or a
pricing supplement thereto, the corporate trust office of the Trustee in The
City of New York will be designated as the Company's sole Paying Agent for
payments with respect to Offered Securities. Any other Paying Agents initially
designated by the Company for the Offered Securities will be named in an
applicable Prospectus Supplement or a pricing supplement thereto. The Company
may at any time designate additional Paying Agents or rescind the designation of
any Paying Agent or approve a change in the office through which any Paying
Agent acts, except that the Company will be required to maintain a Paying Agent
in each Place of Payment for each series of Securities.
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All moneys paid by the Company to a Paying Agent or held by the Company in
trust for the payment of principal of (and premium, if any) or interest on any
Security, which remain unclaimed at the end of two years after such principal,
premium or interest shall have become due and payable, will be discharged from
trust and repaid to the Company, and the Holder of such Security or any coupon
will thereafter look only to the Company for payment thereof. (Section 1103)
SATISFACTION AND DISCHARGE OF THE INDENTURE AND THE SECURITIES
The Indenture will cease to be of further effect, and the Trustee shall
execute instruments acknowledging satisfaction and discharge of the Indenture
and shall pay, or assign or transfer and deliver, the Trust Estate held by it as
security for the Securities remaining, when (1) either (a) all Securities
authenticated and delivered (other than certain specified Securities) have been
delivered for cancellation; or (b) all such Securities have become or will
become within one year due and payable, or are to be called for redemption
within one year under arrangements satisfactory to the Trustee, and the Company
has deposited or caused to be deposited in trust with the Trustee funds
sufficient to pay and discharge the entire indebtedness on such Securities for
principal (and premium, if any) and interest to the date of such deposit (in the
case of Securities that have become due and payable) or to their Stated Maturity
or Redemption Date, as the case may be; (2) the Company has paid or caused to be
paid all other sums payable by it under the terms of the Indenture; and (3) the
Company has delivered to the Trustee an Officers' Certificate and an Opinion of
Counsel, each stating that all conditions precedent provided for in the
Indenture relating to the satisfaction and discharge of the Indenture have been
complied with. (Section 501)
Unless otherwise provided in the Indenture or other instrument creating a
series or tranche of Securities, the Company shall be deemed to have paid and
discharged the indebtedness on all the Outstanding Securities of each tranche of
such series and the Trustee shall execute instruments acknowledging the
satisfaction and discharge of such indebtedness and shall pay, or assign or
transfer and deliver to the Company the Designated Mortgage Bonds which have
been held as security for the Securities of such series or tranche if (1) either
(a) with respect to all Outstanding Securities of such series or tranche (i) the
Company has irrevocably deposited or caused to be deposited with the Trustees an
amount sufficient to pay and discharge the entire indebtedness on all
Outstanding Securities of such series or tranche for principal (and premium, if
any) and interest to the Stated Maturity or any Redemption Date, as the case may
be; or (ii) the Company has irrevocably deposited or caused to be deposited with
the Trustee such amount of direct noncallable obligations of, or noncallable
obligations the payment of principal of and interest on which is fully
guaranteed by, the United States of America maturing as to principal and
interest in such amounts and at such times as will, without consideration of any
reinvestment thereof, be sufficient to pay and discharge the entire indebtedness
on all Outstanding Securities of such series or tranche for principal (and
premium, if any) and interest to the Stated Maturity or any Redemption Date, as
the case may be; or (b) the Company has properly fulfilled such other means of
satisfaction and discharge as are specified in the supplemental indenture or
other instrument creating such series or tranche; (2) the Company has paid or
caused to be paid all other sums payable with respect to the Outstanding
Securities of such series or tranche; (3) the Company has delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel, each stating that
all conditions precedent provided for in the Indenture relating to the
satisfaction and discharge of the entire indebtedness on all Outstanding
Securities of any such series or tranche have
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been complied with and, if required by Section 314 of the Trust Indenture Act, a
certificate or opinion of an engineer, appraiser, or other expert appointed by
the Company as to the fair value of the Trust Estate to be released from the
lien of the Indenture, which certificate or opinion shall state that in the
opinion of the person making the same, such release will not impair the security
under the Indenture in contravention of the provisions thereof; and (4) the
Trustee has received an opinion of tax counsel to the effect that such deposit
and discharge will not cause the Holders of the Outstanding Securities of such
series to recognize income, gain or loss for federal income tax purposes and
that the Holders will be subject to federal income tax in the same amounts, in
the same manner and at the same times as would have been the case if such
deposit and discharge had not occurred. Upon such discharge, the Company will
be deemed to have satisfied all the obligations under the Indenture, except for
obligations with respect to registration of transfer and exchange of the
Outstanding Securities of such series, and the rights of the Holders to receive
from deposited funds payment of the principal of (and premium, if any) and
interest, if any, on the Outstanding Securities of such series. (Section 503)
EVENTS OF DEFAULT
Any one of the following events will constitute an Event of Default under
the Indenture with respect to Securities of any series: (a) failure to pay any
interest on any Security of that series when due, continued for 60 days; (b)
failure to pay principal of (or premium, if any, on) any Security of that series
when due; (c) failure to deposit any sinking fund payment or analogous
obligation, when due, in respect of any Security of that series and continuance
of such default for 60 days; (d) failure to perform any other covenant or
warranty of the Company in the Indenture (other than a covenant or warranty
included in the Indenture solely for the benefit of a series of Securities other
than that series), continued for 60 days after written notice as provided in the
Indenture; (e) certain events of bankruptcy, insolvency or reorganization
involving the Company; (f) the occurrence of an event of default under the
Mortgage Indenture, provided that, the waiver or cure of any such event of
default and the rescission and annulment of the consequences thereof shall
constitute a waiver of the corresponding Event of Default under the Indenture
and a rescission and annulment of the consequences thereof; and (g) any other
Event of Default provided in an indenture supplemental thereto. (Section 601)
Unless the Trustee holds more than 25% of the outstanding Mortgage Bonds
under the Mortgage Indenture, it cannot, without the concurrence of other
holders of first mortgage bonds, force a declaration of "default" under the
Mortgage Indenture or acceleration of the Mortgage Bonds. See "Description of
Mortgage Bonds - Defaults".
If an Event of Default with respect to Securities of any series at the time
Outstanding occurs and is continuing, either the Trustees or the Holders of at
least 25% in aggregate principal amount of the Outstanding Securities of that
series by notice as provided in the Indenture may declare the principal amount
(or, if the Securities of that series are Original Issue Discount Securities,
such portion of the principal amount as may be specified in the terms of that
series) of all the Securities of that series to be due and payable immediately.
At any time after a declaration of acceleration with respect to Securities of
any series has been made, but before a judgment or decree for payment of money
has been obtained by the Trustees, and subject to applicable law and certain
other provisions of the Indenture, the
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Holders of a majority in aggregate principal amount of the Outstanding
Securities of that series may, under certain circumstances, rescind and annul
such acceleration. (Section 602)
The Indenture provides that, if a default occurs with respect to the
Securities of any series, the Trustee shall give notice of default to the
Holders of the Securities of such series within 90 days after receipt by the
Trustee of written notice of such occurrence as and to the extent provided in
the Trust Indenture Act; provided, however, that in the case of any default
referred to in clause (d) of the third preceding paragraph with respect to
Securities of such series, no such notice to Holders shall be given until at
least 30 days after the occurrence thereof. (Section 702)
Upon the occurrence of an Event of Default with respect to Securities of
any series, the Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders of Securities of such series by all
appropriate judicial proceedings, including the rights of the Trustee as the
holder of the Mortgage Bonds; provided, however, the Trustee shall not have the
power to sell the Mortgage Bonds. (Section 603)
The Indenture provides that, subject to the duty of the Trustee during
default to act with the required standard of care, the Trustee will be under no
obligation to exercise any of its rights or powers under the Indenture at the
request or direction of any of the Holders, unless such Holders shall have
offered to the Trustee reasonable indemnity. (Sections 701 and 703) Subject to
such provisions for the indemnification of the Trustee, and subject to
applicable law and certain other provisions of the Indenture, the Holders of a
majority in aggregate principal amount of the Outstanding Securities of any
series will have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred on the Trustee, with respect to the Securities of that
series. (Section 612)
The Company will be required to furnish to the Trustee annually a statement
as to the performance by the Company of certain of its obligations under the
Indenture and as to any default in such performance. (Section 1108)
MODIFICATION AND WAIVER
Modifications and amendments of the Indenture may be made by the Company
and the Trustee with the consent of the Holders of not less than a majority in
aggregate principal amount of the Outstanding Securities of each series,
considered as one class; provided, however, if less than all of the series of
Outstanding Securities are directly affected by such amendment or modification,
then the consent only of the Holders of a majority in aggregate principal amount
of Outstanding Securities of all series so directly affected, considered as one
class, will be required; and provided, further, that if the Outstanding
Securities of any series have been issued in more than one tranche and if the
proposed amendment or modification directly affects the rights of the Holders of
one or more, but less than all, such tranches, then the consent only of the
Holders of a majority in aggregate principal amount of the Outstanding
Securities of all tranches (including each tranche which is the only tranche of
Outstanding Securities in a series) so directly affected, considered as one
class, will be required; and provided, further, that no such amendment or
modification may, without the consent of each Holder of the Outstanding
Securities of each series or tranche directly affected thereby,
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(a) change the Stated Maturity of the principal of, or any installment of
principal of or interest on, any Security, (b) reduce the principal amount of,
or premium or interest on, any Security, (c) reduce the amount of principal of
an Original Issue Discount Security payable upon acceleration of the Maturity
thereof, (d) permit the creation of any lien ranking prior to the lien of the
Mortgage Indenture with respect to all or substantially all of the property
subject thereto or deprive such Holder of the benefit of the security of the
lien of the Mortgage Indenture, (e) change the Place of Payment where, or the
coin or currency in which, any Security or any premium or interest thereon is
payable, (f) impair the right to institute suit for the enforcement of any
payment on or after the Stated Maturity of any Security (or, in the case of
redemption, on or after the Redemption Date), (g) reduce the percentage and
principal amount of the Outstanding Securities of any series or tranche, the
consent of whose Holders is required in order to take certain actions or modify
any of the above provisions or (h) alter, amend or modify Article Four of the
Indenture. (Section 1002(1) and (2))
The Holders of at least 66 2/3% in aggregate principal amount of the
Outstanding Securities of each series or tranche may, on behalf of the Holders
of all the Securities of that series or tranche, waive, insofar as that series
or tranche is concerned, compliance by the Company with certain restrictive
provisions of the Indenture. (Section 1109) The Holders of not less than a
majority in aggregate principal amount of the Outstanding Securities of each
series or tranche may, on behalf of all Holders of Securities of that series or
tranche, waive any past default and its consequences under the Indenture with
respect to Securities of that series or tranche, except a default (a) in the
payment of principal of (or premium, if any) or any interest on any Security of
such series or tranche or (b) in respect of a covenant or provision of the
Indenture that cannot be modified or amended without the consent of the Holder
of each Outstanding Security affected thereby. (Section 613)
The Indenture provides that in determining whether the Holders of the
requisite principal amount of the Outstanding Securities have given any request,
demand, authorization, direction, notice, consent or waiver thereunder or
whether a quorum is present at a meeting of Holders of Securities or the number
of votes entitled to be cast by the Holder of any Security (i) the principal
amount of an Original Issue Discount Security that shall be deemed to be
Outstanding shall be the amount of the principal thereof that would be due and
payable as of the date of such determination upon acceleration of the Maturity
thereof, and (ii) Securities owned by the Company or any other obligor upon the
Securities or any Affiliate of the Company or of such other obligor shall be
disregarded and deemed not to be Outstanding.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company, without the consent of the Holders of any of the Outstanding
Securities under the Indenture, may consolidate or merge with or into, or
transfer or lease its properties and assets substantially as an entirety to, any
Person that is a corporation, partnership or trust organized and validly
existing under the laws of any domestic jurisdiction, or may permit any such
Person to consolidate with or merge into the Company or convey, transfer or
lease its properties and assets substantially as an entirety to the Company,
provided that (a) any successor Person assumes the Company's obligations on the
Securities and under the Indenture, (b) after giving effect to the transaction
no Event of Default, and no event which, after notice or lapse of time or both,
would become an Event of Default, shall have occurred and be continuing, (c) in
the case of any lease, such lease will be expressly subject to
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termination by the Company or by the Trustee at any time during the continuance
of an Event of Default, and (d) certain other conditions are met. (Section 901)
NOTICES
Except as otherwise provided in the Indenture, notices to Holders of
Securities will be given by mail to the addresses of such Holders as they appear
in the Security Register. (Section 106)
TITLE
The Company, the Trustee and any agent of the Company or the Trustee may
treat the registered owner of any Security as the absolute owner thereof
(whether or not such Security shall be overdue and notwithstanding any notice to
the contrary) for the purpose of making payment and for all other purposes.
(Section 308)
GOVERNING LAW
The Indenture and the Securities will be governed by, and construed in
accordance with, the laws of the State of New York, without regard to principles
of conflicts of laws thereof. (Section 113)
CONCERNING THE TRUSTEE
Bankers Trust Company will be the Trustee under the Indenture. Bankers
Trust Company also acts as issuing and paying agent with respect to the
Company's commercial paper program.
DESCRIPTION OF MORTGAGE BONDS
The following summarizes certain provisions of the Mortgage Indenture and
the Mortgage Bonds, and reference is made to the Mortgage Indenture in its
entirety for the detailed provisions thereof.
GENERAL
In order to secure by the lien of the Mortgage Indenture the obligation of
the Company to pay the principal of (and premium, if any) and interest on any
series or tranche of the Securities in accordance with the terms thereof, the
Company will from time to time issue and deliver to and pledge with the Trustee,
in trust for the ratable benefit of the Holders of such series or tranche, one
or more series of Mortgage Bonds. For additional information concerning the
pledge of the Mortgage Bonds with the Trustee, see "Description of Debt
Securities--Security; Pledge of Mortgage Bonds".
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SINKING OR IMPROVEMENT FUNDS
No series of the Mortgage Bonds will be entitled to the benefits of any
sinking fund provision unless applicable specifically to the Mortgage Bonds.
Such provisions are in effect with respect to certain other series of first
mortgage bonds outstanding under the Mortgage Indenture.
KIND AND PRIORITY OF LIEN
The Mortgage Bonds will be secured, equally and ratably with all first
mortgage bonds of other series now or hereafter outstanding, by a first lien on
substantially all properties and franchises owned by the Company at October 31,
1940 and on property and franchises subsequently acquired which in each case are
used or useful in the business of furnishing electricity, water or gas, or in
any business incidental thereto or operated in connection therewith, except
properties released pursuant to the Mortgage Indenture and except certain
property in Nevada acquired after the filing of the Thirty-fourth Supplemental
Indenture with respect to the Mortgage Bonds, and before the filing of a
supplemental indenture specifically subjecting such property to such lien;
subject, however, to the lien of the Trustees for their compensation, expenses
and advances, to certain permitted liens, and to liens on after acquired
property existing at the time of acquisition or created in connection with the
purchase thereof. There are specifically excepted from the lien of the Mortgage
Indenture certain current assets, including accounts receivable, securities and
other personal property; timber; oil and other minerals; certain other property
owned at October 31, 1940; and all property subsequently acquired, not used or
useful to the Company in its utility business.
ISSUANCE OF ADDITIONAL FIRST MORTGAGE BONDS AND WITHDRAWAL
OF CASH DEPOSITED AGAINST SUCH ISSUANCE
The maximum principal amount of first mortgage bonds which may be issued
under the Mortgage Indenture is not limited. Additional first mortgage bonds of
any series may be issued from time to time on the basis of (1) 60% of a net
amount of additional public utility property not theretofore funded (i.e., gross
property additions, including the Company's interest in jointly owned property,
less the excess of aggregate retirements over any credit for substitution); (2)
retirement of first mortgage bonds, not theretofore funded; and (3) deposit of
cash. With certain exceptions, the issuance of first mortgage bonds is subject
to net earnings available for interest for 12 consecutive months out of the
preceding 15 months being at least 2 times the annual interest requirements on
all first mortgage bonds and all prior lien debt to be outstanding. Cash
deposited with the Trustee pursuant to (3) above may be withdrawn in amounts
equal to the amount of first mortgage bonds issuable under (1) or (2) above or
be applied to the retirement of first mortgage bonds of any series. For the 12
months ended September 30, 1996, the net earnings available for interest were
____ times such annual interest requirements, which would permit the issuance of
approximately $___ million principal amount of additional first mortgage bonds
(after giving effect to the issuance of the Mortgage Bonds) assuming the annual
interest on such additional first mortgage bonds is equal to ___%.
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THE TRUSTEES
The written request of the holders of a majority of the aggregate
outstanding principal amount of the first mortgage bonds is necessary to require
the Trustees to exercise any remedy under the Mortgage Indenture; the Trustees
are entitled to receive reasonable indemnity and under certain circumstances are
not required to act.
DEFAULTS
A default is defined as (a) failure to pay interest for 90 days after
becoming due, (b) failure to pay principal when due, (c) failure to pay
principal or interest on any prior lien debt or satisfy any covenant or
condition in the instrument evidencing or securing any such prior lien debt if
any right of foreclosure or right of entry or of sale shall have arisen, (d)
failure for 90 days after notice to observe any other covenants or conditions,
including sinking fund obligations, in the Mortgage Indenture, (e) adjudication
of the Company as a bankrupt, entry of an order approving a reorganization
petition or appointment of a trustee or receiver in certain proceedings and the
continuance of such adjudication, order or appointment for 90 days, and (f) the
Company's admission of its inability to pay its debts, the Company's making of
an assignment for the benefit of creditors, or certain petitions or consents in
bankruptcy, insolvency or reorganization proceedings.
In addition, the Thirty-fifth Supplemental Indenture provides that if any
of the following events of default occurs under the Indenture, it shall be
deemed to be a default under the Mortgage Indenture as hereafter provided: (i)
default in the payment of any interest upon any Security when such interest
becomes due and payable shall be deemed to be a default in the due and punctual
payment of a like amount of interest on the Mortgage Bonds, (ii) default in the
payment of the principal of (or premium, if any, on) any Security at the stated
maturity thereof or upon redemption thereof shall be deemed to be a default in
the due and punctual payment of a like amount of principal of the Mortgage
Bonds, (iii) default in the deposit of any sinking fund payment when and as due
by the terms of a Security shall be deemed to be a default under the Mortgage
Indenture, (iv) a default in the performance, or breach, of any covenant or
warranty of the Company as described in Section 601(4) of the Indenture shall be
deemed to be a default under the Mortgage Indenture, (v) the occurrence of an
event described in Section 601(5) of the Indenture shall be deemed to be a
default under Section 10.01(e) of the Mortgage Indenture, (vi) the occurrence of
an event described in Section 601(6) of the Indenture shall be deemed to be a
default under Section 10.01(f) of the Mortgage Indenture and (vii) the
occurrence of an event of default provided in an indenture supplemental to the
Indenture shall be deemed to be a default under the Mortgage Indenture.
Upon a default, the Trustees may exercise any of their rights under the
Mortgage Indenture and upon direction of a majority of the outstanding first
mortgage bonds must so act if certain conditions are met.
MODIFICATION OF MORTGAGE AND WAIVER OF DEFAULT
The rights of the holders of first mortgage bonds may be modified with the
consent of the holders of 75% of the first mortgage bonds, including, unless all
are affected alike, not less than 75% of each series affected; provided,
however, no modification of the terms of payment of principal or interest (other
than postponement of any interest payment date for
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not more than 3 years, which may be consented to by the holders of 75% of the
first mortgage bonds) and no modification depriving the holder of a lien on the
mortgaged property or reducing the percentage required for modification is
effective against any bondholder without his consent. Uncured defaults (except
in payment of principal or interest) may be waived by the holders of 75% of the
first mortgage bonds (including the holders of 60% of the first mortgage bonds
of each series).
VOTING OF THE MORTGAGE BONDS
The Trustee will attend such meetings of the holders of first mortgage
bonds, or deliver its proxy in connection therewith, as relate to matters with
respect to which it shall be entitled to vote or consent. The Indenture
provides that so long as no event of default shall have occurred and be
continuing under the Indenture, the Trustee will vote or consent as a holder of
the Designated Mortgage Bonds proportionately with what the Trustee reasonably
believes will be the vote or consent of the holders of all other first mortgage
bonds outstanding under the Mortgage Indenture that will vote or consent,
provided, however, that the Trustee will not so vote in favor of, or so consent
to, any amendment or modification of the Mortgage Indenture which, if it were an
amendment or modification of the Indenture, would require the consent of Holders
of Securities as described under "Description of Debt Securities--Modification
and Waiver," without the prior written consent of Holders of Outstanding
Securities which would be required for such an amendment or modification of the
Indenture.
RESTRICTIVE COVENANTS
Certain series of the Company's first mortgage bonds impose specific
dividend restrictions on the Company, the most restrictive of which currently
provides that so long as there are outstanding any bonds of such series, the
Company may not (a) declare or pay any dividend (other than dividends payable in
common stock of the Company) on or make any other distribution in respect of any
shares of the common stock of the Company, or (b) purchase, redeem, retire or
otherwise acquire for a consideration (other than in exchange for or from the
proceeds of other shares of capital stock of the Company) any shares of capital
stock of the Company of any class, except to the extent required to comply with
any sinking or purchase fund which may now exist or hereafter be established for
any class of preferred stock of the Company, if the aggregate amount so
declared, paid, distributed or expended after December 31, 1961 would exceed the
aggregate amount of the net income of the Company available for dividends on its
common stock accumulated after December 31, 1961, plus the sum of $1,900,000.
As each series of first mortgage bonds subject to this restriction matures or
otherwise ceases to be outstanding, the Securities will cease to have the
benefit of such series' restrictive covenants.
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CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
The following summary describes certain United States federal income tax
considerations that may be relevant to a holder of a Debt Security who is
subject to United States federal income taxation on a net income basis in
respect of a Debt Security (an "Owner"). This summary deals only with Owners
who will hold Debt Securities as capital assets and does not address tax
considerations applicable to investors that may be subject to special tax rules,
such as banks, insurance company, or dealers in securities, or persons who will
hold Debt Securities as a position in a "straddle" for tax purposes.
This summary is based on laws, existing and proposed regulations,
administrative rules, and judicial decisions as of the date hereof, all of which
are subject to change. Prospective investors should consult their own tax
advisors in determining the tax consequences to them of holding Debt Securities,
including the application to their particular situation of the federal income
tax considerations discussed below, as well as the application of state, local
or other tax laws and prospects for enactment of future tax legislation or
regulations.
PAYMENTS OF INTEREST
Payments of interest on a Debt Security (other than a "Discount Security"
as defined below) will generally be taxable to an Owner as ordinary interest
income at the time such payments are accrued or are received in accordance with
the Owner's method of federal income tax accounting.
ORIGINAL ISSUE DISCOUNT
A Debt Security may be issued for an amount that is less than its stated
redemption price at Stated Maturity. The difference, if it exceeds 0.25 percent
of the stated redemption price at Stated Maturity multiplied by the number of
full years to maturity, will be "original issue discount" ("OID"). (Debt
Securities issued with OID shall be referred to as "Discount Securities.") For
this purpose, a Debt Security's stated redemption price at Stated Maturity
includes all payments to be made other than payments of "qualified stated
interest" (generally, interest payable on the outstanding principal amount at a
fixed rate or at a qualifying variable rate at least annually). Notice will be
given in the applicable Prospectus Supplement or pricing supplement thereto when
the Company determines that a particular Debt Security will be a Discount
Security.
Owners of Discount Securities should be aware that they must, in general,
include OID income in advance of the receipt of some or all of the related cash
payments. With respect to Discount Securities having a term in excess of one
year, the OID will be included in income currently as interest as it accrues
over the life of the Debt Security under a formula based upon the compounding of
interest at a rate that provides for a constant yield to maturity. Accrued OID
must be included in income by subsequent as well as original owners of Discount
Securities. See "Premium and Market Discount" below.
In certain cases, where interest payments do not constitute qualified
stated interest under the applicable Treasury regulations, Debt Securities that
bear interest from a non-tax standpoint may be deemed instead to bear OID for
federal income tax purposes. Treasury regulations would characterize Debt
Securities as Discount Securities if, for example, such
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Debt Securities provide for teaser rates, interest holidays, or other interest
short-falls resulting in more than a de minimis amount of OID, or bear interest
pursuant to an interest rate formula subject to a cap, floor, or similar
interest rate limitation that is reasonably expected, as of the date of issue,
to cause the interest rate for one or more accrual periods to be significantly
higher or lower (as the case may be) than the overall expected return on the
Debt Security determined without such cap, floor or other limitation.
Accordingly, Owners, including Owners who use the cash method of accounting for
federal income tax purposes, would be required to report interest in respect of
such a Debt Security under the method described above for Discount Securities.
Holders should consult their own tax advisors as to whether Debt Securities will
be considered to have been issued with OID under such circumstances and as to
the effect thereof on their particular situations.
Treasury Regulations provide an election for an Owner which uses the
accrual method to treat all interest on a Discount Security as OID which accrues
on a constant yield basis. Owners and prospective investors should consult
their tax advisors regarding the availability and tax consequences of this
election.
In the case of Discount Securities having a term of one year or less
("Short-Term Discount Securities"), OID is included in income currently either
on a straight-line basis or, if the Owner so elects, under the constant-yield
method used generally for OID. However, certain categories of Owners (generally
individuals or other taxpayers who use the cash method of accounting for federal
income tax purposes) are not required to include accrued OID on Short-Term
Discount Securities in their income currently unless they elect to do so. If
such an Owner that does not elect to currently include OID in income
subsequently recognizes a gain upon the disposition of the Discount Security,
such gain may be treated as ordinary interest income to the extent of the
accrued OID. Furthermore, such an Owner of Short-Term Discount Securities may
be required to defer deductions for a portion of the Owner's interest expenses
with respect to any indebtedness incurred or maintained to purchase or carry
such a Discount Security. In the case of Owners that are required to include
OID on Short-Term Discount Securities in income currently, the amount of accrued
OID included in income will be added to the Owner's tax basis in the Discount
Security.
The Company will provide annual information statements to the holders of
Discount Securities and to the Internal Revenue Service regarding the amount of
OID determined to be attributable to such Discount Securities for that year.
Prospective investors are advised to consult their tax advisers with respect to
the particular OID characteristics of any Discount Security and with respect to
any available elections that could affect the federal income tax consequences of
holding Discount Securities.
BASIS, SALE, EXCHANGE AND RETIREMENT
In general, an Owner's tax basis in a Debt Security will equal the Owner's
cost for the Debt Security, increased by any amounts includible in income by the
Owner as OID or market discount (as described below) and reduced by any
amortized acquisition premium (as described below) and any payments other than
qualified stated interest payments made on such Debt Security. Upon the sale,
exchange or retirement of a Debt Security, an Owner will recognize gain or loss
equal to the difference between the amount realized on the sale, exchange or
retirement (less any accrued qualified periodic interest not previously taken
into account, which will be taxable as such) and the owner's tax basis in the
Debt Security, except
19
<PAGE>
with respect to certain Short-Term Discount Securities. See "Original Issue
Discount" above. Except as discussed below with respect to market discount,
gain or loss recognized by an owner on the sale, exchange or retirement of a
Debt Security will be long-term capital gain or loss if the owner has held the
Debt Security for more than one year at the time of disposition. In the case of
individuals, capital gains are currently taxed at a maximum marginal federal
income tax rate of 28% while ordinary income is subject to a maximum marginal
federal income tax rate of 39.6%. In the case of corporations, the maximum
marginal federal income tax rate is 35% for both ordinary income and capital
gains. The distinction between capital gain or loss and ordinary income or loss
is also relevant for purposes of limitations on the deductibility of capital
losses and for determining the allowance for charitable deductions.
PREMIUM AND MARKET DISCOUNT
An Owner who purchases a Discount Security for any amount that is greater
than its "adjusted issue price" (defined as the sum of the issue price of the
Discount Security and the portion of OID previously includible, disregarding any
reduction on account of acquisition premium, as discussed below, in the gross
income of any Owners of the Discount Security and reduced by the amount of any
payment previously made on the Discount Security other than a qualified stated
interest payment) and less than or equal to its stated redemption price at
Stated Maturity, reduced by the amount of any payment previously made on the
Discount Security other than a qualified stated interest payment, will be
considered to have purchased such Original Issue Discount Security at an
"acquisition premium." The amount of OID that such Owner must include in its
gross income with respect to such Discount Security for any taxable year is
generally reduced by the portion of such acquisition premium properly allocable
to such year. If an Owner purchases a Debt Security for a cost in excess of its
stated redemption price at Stated Maturity (reduced by the amount of any payment
made on the debt instrument prior to the purchase date other than a qualified
stated interest payment), such Debt Security will have no OID, and such Owner
may elect to amortize such premium, using a constant interest method, generally
over the remaining term of the Debt Security. Such premium generally shall be
deemed to be an offset to interest otherwise includible with respect to the Debt
Security. Premium on a Debt Security held by an Owner that does not make such
an election will decrease the gain or increase the loss otherwise recognized on
disposition of the Debt Security.
If an Owner purchases a Debt Security or a Discount Security for an amount
that is less than, respectively, its stated redemption price at Stated Maturity
or its revised issue price (defined as the sum of the issue price of the
Discount Security and the aggregate amount of OID includible, disregarding any
reduction on account of acquisition premium, as discussed above, in the gross
income of all owners of the Discount Security), the amount of the difference
generally will be treated as "market discount" for federal income tax purposes,
unless such difference is less than a specified de minimis amount. Under the
market discount rules, an Owner will be required to treat any principal payment
on, or any gain on the sale, exchange, retirement or other disposition of, a
Debt Security as ordinary income to the extent of the market discount that has
accrued (and has not previously been included in income) during the period such
Owner held the Debt Security. In addition, the Owner may be required to defer,
until the maturity of the Debt Security or its earlier disposition in a taxable
transaction, the deduction of all or a portion of the interest expense on any
indebtedness incurred or continued to purchase or carry such Debt Security.
20
<PAGE>
Any market discount will be considered to accrue ratably during the period
from the date of acquisition to the maturity date of the Debt Security, unless
the Owner elects to accrue on a constant interest basis. An Owner of a Debt
Security may elect to include market discount in income currently as it accrues
(on either a ratable or a constant interest basis with a corresponding increase
in the Owner's tax basis in the Debt Security), in which case the rule described
above regarding deferral of interest deductions will not apply. This election
to include currently, once made, applies to all market discount obligations
acquired on or after the first taxable year to which the election applies and
may not be revoked without the consent of the Internal Revenue Service.
BACKUP WITHHOLDING
In general, if a holder fails to furnish a correct taxpayer identification
number or certification of exempt status, fails to report dividend and interest
income in full, or fails to certify that he has provided a correct taxpayer
identification number and that he is not subject to withholding, the Company may
withhold a 31 percent federal backup withholding tax on certain amounts paid or
deemed paid (including OID) to the holder. An individual's taxpayer
identification number is his social security number. The backup withholding tax
is not an additional tax and may be credited against a holder's regular federal
income tax liability or refunded by the Internal Revenue Service where
applicable.
PLAN OF DISTRIBUTION
The Company may sell Debt Securities to or through underwriters or dealers
and also may sell Debt Securities directly or through agents. The Prospectus
Supplement or the pricing supplement thereto will set forth the names of any
underwriters or agents involved in the sale of the Offered Securities and any
applicable commissions or discounts.
Underwriters, dealers or agents may offer and sell the Offered Securities
at a fixed price or prices, which may be changed, or from time to time at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices or at negotiated prices. In connection with the sale of Offered
Securities, underwriters, dealers or agents may be deemed to have received
compensation from the Company in the form of underwriting discounts or
commissions and may also receive commissions from purchasers of Offered
Securities for whom they may act as agent. Underwriters or agents may sell
Offered Securities to or through dealers, and such dealers may receive
compensation in the form of discounts, concessions or commissions from the
underwriters and/or commissions (which may be changed from time to time) from
the purchasers for whom they may act as agent.
The Offered Securities, when first issued, will have no established trading
market. Any underwriters, dealers or agents to or through whom Offered
Securities are sold by the Company for public offering and sale may make a
market in such Offered Securities, but such underwriters, dealers or agents will
not be obligated to do so and may discontinue any market making at any time
without notice. No assurance can be given as to the liquidity of the trading
market for any Offered Securities.
Any underwriters, dealers and agents participating in the distribution of
the Offered Securities may be deemed to be underwriters and any discounts and
commissions received by them and any profit realized by them on resale of the
Offered Securities may be deemed
21
<PAGE>
to be underwriting discounts and commissions, under the Act. Underwriters,
dealers and agents may be entitled, under agreements with the Company, to
indemnification against and contribution toward certain civil liabilities,
including liabilities under the Act, and to reimbursement by the Company for
certain expenses.
If so indicated in an applicable Prospectus Supplement or pricing
supplement thereto, the Company will authorize dealers acting as the Company's
agents to solicit offers by certain institutions to purchase Offered Securities
from the Company at the public offering price set forth in such Prospectus
Supplement or pricing supplement thereto pursuant to contracts providing for
payment and delivery on a future date. Institutions with which such contracts
may be made include commercial and savings banks, insurance companies, pension
funds, investment companies, educational and charitable institutions and other
institutions, but in all cases such institutions must be approved by the
Company. The obligations of any purchaser under any such contract will be
subject to the condition that the purchase of the Offered Securities shall not
at the time of delivery be prohibited under the laws of any jurisdiction in the
United States to which such institution is subject. The underwriters and such
other persons will not have any responsibility in respect of the validity or
performance of such contracts.
EXPERTS
The balance sheets and statements of capitalization of the Company as of
December 31, 1995 and 1994, and the statements of income, common shareholder's
equity and cash flows for each of the three years in the period ended December
31, 1995, incorporated by reference in this prospectus, have been incorporated
by reference in reliance on the report of Coopers & Lybrand L.L.P., independent
accountants, given on the authority of that firm as experts in auditing and
accounting.
Any financial statements and schedules hereafter incorporated by reference
in the registration statement of which this prospectus is a part that have been
audited and are the subject of a report by independent accountants will be so
incorporated by reference in reliance upon such reports and upon the authority
of such firms as experts in accounting and auditing to the extent covered by
consents filed with the Commission.
The statements made as to matters of law and legal conclusions under the
headings "Description of Debt Securities" and "Certain United States Federal
Income Tax Consequences" contained herein have been reviewed by Choate, Hall &
Stewart (a partnership including professional corporations) and all such
statements are set forth herein upon the authority of such counsel.
ADDITIONAL INFORMATION
With respect to the unaudited interim financial information of the Company
for the periods ended March 31, June 30, and September 30, 1996, incorporated by
reference in this prospectus, the independent accountants have reported that
they have applied limited procedures in accordance with professional standards
for a review of such information. However, their reports included in the
Company's quarterly reports on Form 10-Q for the quarterly periods ended March
31, June 30, and September 30, 1996 and incorporated by reference herein, state
that they did not audit and they do not express an opinion on that
22
<PAGE>
interim financial information. Accordingly, the degree of reliance on their
report on such information should be restricted in light of the limited nature
of the review procedures applied. The accountants are not subject to the
liability provisions of Section 11 of the Act for their reports on the unaudited
interim financial information because those reports are not "reports" or "parts"
of the registration statement prepared or certified by the accountants within
the meaning of Sections 7 and 11 of the Act.
LEGAL OPINIONS
The legality of the Debt Securities offered hereby is being passed upon for
the Company by Choate, Hall & Stewart (a partnership including professional
corporations), Boston, Massachusetts and for the underwriters or agents, if any,
by Ropes & Gray, Boston, Massachusetts. Matters of local law are being passed
upon as to the State of Nevada by Woodburn and Wedge, Reno, Nevada, and as to
the State of California by Graham & James LLP. Choate, Hall & Stewart has
relied upon the opinions of such other counsel as to such matters.
23
<PAGE>
=================================== =================================
NO DEALER, AGENT, SALESPERSON OR
ANY OTHER PERSON HAS BEEN AUTHORIZED
TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE
CONTAINED IN THIS PROSPECTUS, SIERRA PACIFIC
PROSPECTUS SUPPLEMENT AND ANY PRICING POWER
SUPPLEMENT IN CONNECTION WITH THE COMPANY
OFFER CONTAINED HEREIN AND, IF GIVEN
OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY OR BY ANY AGENT. THIS
PROSPECTUS, PROSPECTUS SUPPLEMENT AND
ANY PRICING SUPPLEMENT SHALL NOT
CONSTITUTE AN OFFER TO SELL OR THE $35,000,000
SOLICITATION OF AN OFFER TO BUY ANY
SECURITIES OTHER THAN THE SECURITIES
DESCRIBED IN THE PROSPECTUS,
PROSPECTUS SUPPLEMENT OR ANY PRICING
SUPPLEMENT, OR AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY ANY OF
THE SECURITIES OFFERED HEREBY IN ANY
CIRCUMSTANCES IN WHICH SUCH OFFER OR
SOLICITATION IS UNLAWFUL. NEITHER THE
DELIVERY OF THE PROSPECTUS, PROSPECTUS Collateralized Debt
SUPPLEMENT OR ANY PRICING SUPPLEMENT Securities
NOR ANY SALE MADE HEREUNDER OR
THEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THE INFORMATION CONTAINED HEREIN
OR THEREIN IS CORRECT AS OF ANY TIME
SUBSEQUENT TO THEIR RESPECTIVE DATES.
PROSPECTUS
DECEMBER ___, 1996
TABLE OF CONTENTS
Page
-----
Available Information . . . . . . . . 2
Incorporation of Certain Documents by
Reference . . . . . . . . . . . . 2
The Company . . . . . . . . . . . . . 3
Application of Proceeds . . . . . . . 4
Ratios of Earnings to Fixed Charges . 4
Description of Debt Securities. . . . 4
Description of Mortgage Bonds . . . . 14
Certain United States Federal Income
Tax Consequences . . . . . . . . . 18
Plan of Distribution . . . . . . . . 21
Experts . . . . . . . . . . . . . . . 22
Additional Information. . . . . . . . 22
Legal Opinions . . . . . . . . . . . 23
=================================== =================================
<PAGE>
PART II
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
Expenses payable by the Company in connection with the sale of the Debt
Securities offered hereby are as follows:
Securities and Exchange Commission
Registration Fee . . . . . . . . . . . $10,607
* Blue sky fees and expenses . . . . . . 10,000
Nevada Commission Fee . . . . . . . . . 140
California Commission Fee . . . . . . . 6,500
* Fees and expenses of Trustees . . . . . 4,000
* Fees and expenses of Trustees' Counsel 30,000
* Fees and expenses of Agents' Counsel . 20,000
* Fees and expenses of Company's Counsel
(Special Counsel, California and Nevada
Counsel) . . . . . . . . . . . . . . . 65,000
* Accountant's fees and expenses . . . . 10,000
* Printing, including Form S-3,
prospectuses, exhibits, etc. . . . . . 20,000
** Rating agency fees . . . . . . . . . .
* Miscellaneous expenses . . . . . . . . 4,753
-------------
* Total Expenses . . . . . . $181,000
-------------
-------------
- ---------------------
* Estimated
** To be provided supplementally.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Nevada Revised Statutes provide that under certain circumstances, a
corporation may indemnify any person for amounts incurred in connection with a
pending or threatened action, suit or proceeding in which he is, or is
threatened to be made, a party by reason of his being a director, officer,
employee or agent of the corporation.
The Articles of Incorporation of the Company provide in substance that the
Company will indemnify each of its directors and officers and former directors
and officers against expenses necessarily incurred in connection with the
defense of any action, suit or proceeding in which he or she is made a party by
reason of being or having been a director or officer of the Company, except in
relation to matters as to which he or she shall be adjudged liable for
negligence or misconduct.
The Company has purchased insurance coverage under a policy insuring
directors and officers of the Company against certain liabilities which they may
incur in their capacity as such.
II-1
<PAGE>
In the proposed form of the Distribution Agreement relating to the
registered securities (Exhibit 1.1 to this Registration Statement), it is
provided that the Agents shall indemnify the Company, its directors and certain
officers of the Company against liabilities resulting from information furnished
by or on behalf of the Agents specifically for use in the Registration
Statement.
See "Item 17. Undertakings" for a description of the Securities and
Exchange Commission's position regarding such indemnification provisions.
ITEM 16. EXHIBITS
See Index to Exhibits immediately preceding the Exhibits included as part
of this Registration Statement.
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) do not apply if the
Registration Statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
II-2
<PAGE>
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described under Item 15 above, or
otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act of 1933 and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Reno, State of Nevada, on the 27th day of November,
1996.
SIERRA PACIFIC POWER COMPANY
By /s/ Walter M. Higgins
-----------------------------------
Walter M. Higgins, Chairman,
PRESIDENT AND CHIEF EXECUTIVE OFFICER
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Walter M. Higgins, Malyn K.
Malquist, William E. Peterson and William C. Rogers and each of them, as his or
her true and lawful attorneys-in-fact and agents, with full power of
substitution, for him or her and in his or her name, place and stead, in any and
all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents full power and authority to do and perform each and every act and thing
requisite and necessary to be done in connection therewith, as fully to all
intents and purposes as he or she might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents or any of them, or
their or his substitute or substitutes, shall do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
Signature Title Date
--------- ----- ----
/s/ Walter M. Higgins Chairman, President and November 27, 1996
--------------------- Chief Executive Officer
Walter M. Higgins (Principal Executive
Officer) and Director
/s/ Malyn K. Malquist Senior Vice President and November 27, 1996
--------------------- Chief Financial Officer
Malyn K. Malquist (Principal Financial
Officer) (Principal
Accounting Officer)
/s/ Edward P. Bliss Director November 27, 1996
---------------------
Edward P. Bliss
II-4
<PAGE>
/s/ Krestine M. Corbin Director November 27, 1996
-------------------------
Krestine M. Corbin
/s/ Theodore J. Day Director November 27, 1996
-------------------------
Theodore J. Day
/s/ Harold P. Dayton, Jr. Director November 27, 1996
-------------------------
Harold P. Dayton, Jr.
/s/ James R. Donnelley Director November 27, 1996
-------------------------
James R. Donnelley
/s/ Richard N. Fulstone Director November 27, 1996
-------------------------
Richard N. Fulstone
/s/ James L. Murphy Director November 27, 1996
-------------------------
James L. Murphy
Director November , 1996
-------------------------
Ronald K. Remington
Director November , 1996
-------------------------
Dennis E. Wheeler
Director November , 1996
-------------------------
Robert B. Whittington
II-5
<PAGE>
INDEX TO EXHIBITS
EXHIBIT
NO. DESCRIPTION
- ------- -----------
# 1.1 - Form of Distribution Agreement by and among the
Company and the Agents.
* 4.1 - Collateral Trust Indenture dated as of June 1, 1992
between the Company and Bankers Trust Company, in
its capacity as Trustee (Exhibit B to Form 8-K
dated July 15, 1992).
* 4.2 - First Supplemental Indenture dated as of June 1,
1992 to Collateral Trust Indenture dated as of June
1, 1992 between the Company and Bankers Trust
Company, as Trustee (Exhibit B to Form 8-K dated
July 15, 1992).
* 4.3 - Second Supplemental Indenture to Collateral Trust
Indenture dated as of June 1, 1992 between the
Company and Bankers Trust Company, as Trustee
(Exhibit B to Form 8-K dated October 25, 1993).
* 4.4 - Third Supplemental Indenture to Collateral Trust
Indenture dated as of February 1, 1996 between the
Company and Bankers Trust Company, as Trustee
(Exhibit B to Form 8-K dated March 11, 1996).
# 4.5 - Form of Fourth Supplemental Indenture to Collateral
Trust Indenture between the Company and Bankers
Trust Company, as Trustee.
* 4.6 - Form of Medium-Term Global Floating Rate Note,
Series A (Exhibit E to Form 8-K dated July 15,
1992).
* 4.7 - Form of Medium-Term Global Floating Rate Note,
Series B (Exhibit D to Form 8-K dated October 25,
1993).
* 4.8 - Form of Medium-Term Global Floating Rate Note,
Series C (Exhibit D to Form 8-K dated March 11,
1996).
* 4.9 - Mortgage Indentures of the Company defining the
rights of the holders of the Company's First
Mortgage Bonds - Original Indenture (Exhibit 7-A to
Registration No. 2-7475); Sixth Supplemental
Indenture (Exhibit 4-F to Registration No. 2-
16157); Seventh Supplemental Indenture (Exhibit 2-G
to Registration No. 2-20365); Eighth Supplemental
Indenture (Exhibit 4-I to Registration No. 2-
21479); Ninth Supplemental Indenture (Exhibit 2-M
to Registration No. 2-59509); Tenth Supplemental
Indenture(Exhibit 4-K to Registration No. 2-
23932); Eleventh Supplemental Indenture (Exhibit 4-
L to Registration No. 2-26552); Twelfth
Supplemental Indenture (Exhibit 4-L to Registration
No. 2-36982); Fourteenth Supplemental Indenture
(Exhibit 2-P to Registration No. 2-46592);
Fifteenth Supplemental Indenture (Exhibit 2-Q to
<PAGE>
EXHIBIT
NO. DESCRIPTION
- ------- -----------
Registration No. 2-51862); Sixteenth Supplemental
Indenture (Exhibit 2-Y to Registration No. 2-
53404); Seventeenth Supplemental Indenture (Exhibit
2-U to Registration No. 2-57033); Eighteenth
Supplemental Indenture (Exhibit 2-V to Registration
No. 2-60954); Nineteenth Supplemental Indenture
(originally filed as Exhibit (2)(B) to Annual
Report on Form 10-K filed for the year ended
December 31, 1978 - refiled as Exhibit 4(A) to
Annual Report on Form 10-K filed for the year ended
December 31, 1991); Twentieth Supplemental
Indenture (originally filed as Exhibit (2)(C) to
Annual Report on Form 10-K filed for the year ended
December 31, 1978 - refiled as Exhibit 4(B) to
Annual Report on Form 10-K filed for the year ended
December 31, 1991); Twenty-first Supplemental
Indenture (originally filed as Exhibit (2)(B) to
Annual Report on Form 10-K filed for the year ended
December 31, 1979 - refiled as Exhibit 4(C) to
Annual Report on Form 10-K filed for the year ended
December 31, 1991); Twenty-fourth Supplemental
Indenture (originally filed as Exhibit (a)(4) to
Quarterly Report on Form 10-Q filed for the quarter
ended September 30, 1982 - refiled as Exhibit 4(D)
to Annual Report on Form 10-K filed for the year
ended December 31, 1991); Twenty-fifth Supplemental
Indenture (Exhibit 4-B to Registration No. 33-
6226); Twenty-sixth Supplemental Indenture (Exhibit
4-B to Registration No. 33-23129); Twenty-seventh
Supplemental Indenture (Exhibit (4)(A) to Annual
Report on Form 10-K filed for the year ended
December 31, 1989); Twenty-eighth Supplemental
Indenture (Exhibit 4.3 to Registration No. 33-
48414); Twenty-ninth Supplemental Indenture
(Exhibit D to Form 8-K dated June 15, 1992);
Thirtieth Supplemental Indenture (Exhibit 4(B) to
Annual Report on Form 10-K filed for the year ended
December 31, 1992); Thirty-first Supplemental
Indenture (Exhibit 4(C) to Annual Report on Form
10-K filed for the year ended December 31, 1992);
Thirty-second Supplemental Indenture (Exhibit 4.6
to Registration No. 33-69550); Thirty-third
Supplemental Indenture (Exhibit C to Current Report
on Form 8-K dated October 20, 1993); Thirty-fourth
Supplemental Indenture (Exhibit C to Current Report
on Form 8-K dated March 11, 1996).
# 4.10 - Form of Thirty-fifth Supplemental Indenture.
# 5.1 - Opinion of Choate, Hall & Stewart (a partnership
including professional corporations).
# 5.2 - Opinion of Woodburn and Wedge.
# 5.3 - Opinion of Graham & James LLP.
#12.1 - Statement setting forth computation of ratio of
earnings to fixed charges.
2
<PAGE>
EXHIBIT
NO. DESCRIPTION
- ------- -----------
#15.1 - Awareness letter from Coopers & Lybrand L.L.P.
regarding their reports on unaudited interim
financial information included in the Quarterly
Report of the Company on Form 10-Q for the
quarterly periods ended March 31, 1996, June 30,
1996 and September 30, 1996.
#23.1 - Consent of Coopers & Lybrand L.L.P.
#23.2 - Consent of Choate, Hall & Stewart (a partnership
including professional corporations) (included in
Exhibit 5.1).
#23.3 - Consent of Woodburn and Wedge (included in Exhibit
5.2).
#23.4 - Consent of Graham & James LLP (included in Exhibit
5.3).
24.1 - Power of Attorney of Directors of the Company.
Reference is made to the signature page of the
Registration Statement.
25.1 - Form T-1 Statement of Eligibility and Qualification
under the Trust Indenture Act of 1939 of Bankers
Trust Company.
__________
* Incorporated by reference as indicated.
# To be filed by amendment.
<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF
1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A
TRUSTEE PURSUANT TO SECTION 305(b)(2) ___________
______________________________
BANKERS TRUST COMPANY
(Exact name of trustee as specified in its charter)
NEW YORK 13-4941247
(Jurisdiction of Incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification no.)
FOUR ALBANY STREET
NEW YORK, NEW YORK 10006
(Address of principal (Zip Code)
executive offices)
BANKERS TRUST COMPANY
LEGAL DEPARTMENT
130 LIBERTY STREET, 31ST FLOOR
NEW YORK, NEW YORK 10006
(212) 250-2201
(Name, address and telephone number of agent for service)
_________________________________
SIERRA PACIFIC POWER COMPANY
(Exact name of obligor as specified in its charter)
NEVADA 88-0044418
(State or other jurisdiction of (I.R.S. employer
Incorporation or organization) Identification no.)
P.O. BOX 10100 (6100 NEIL ROAD)
RENO, NEVADA 89520-0400
(Address of principal executive offices) (Zip Code)
COLLATERALIZED DEBT SECURITIES
(Title of the indenture securities)
<PAGE>
ITEM 1. GENERAL INFORMATION.
Furnish the following information as to the trustee.
(a) Name and address of each examining or supervising authority to
which it is subject.
NAME ADDRESS
---- -------
Federal Reserve Bank (2nd District) New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
New York State Banking Department Albany, NY
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
ITEM 2. AFFILIATIONS WITH OBLIGOR.
If the obligor is an affiliate of the Trustee, describe each such
affiliation.
None.
ITEM 3.-15. NOT APPLICABLE
ITEM 16. LIST OF EXHIBITS.
EXHIBIT 1 - Restated Organization Certificate of Bankers Trust
Company dated August 7, 1990 and Certificate of
Admendment of the Organization Certificate of Bankers
Trust Company dated March 21, 1996 - Incorporated
herein by reference to Exhibit 1 filed with Form T-1
Statement, Registration No. 333-15263.
EXHIBIT 2 - Certificate of Authority to commence business -
Incorporated herein by reference to Exhibit 2 filed
with Form T-1 Statement, Registration No. 33-21047.
EXHIBIT 3 - Authorization of the Trustee to exercise corporate
trust powers - Incorporated herein by reference to
Exhibit 2 filed with Form T-1 Statement, Registration
No. 33-21047.
EXHIBIT 4 - Existing By-Laws of Bankers Trust Company, as amended
on September 17, 1996 - Incorporated herein by
reference to Exhibit 4 filed with Form T-1 Statement,
Registration No. 333-15263.
EXHIBIT 5 - Not applicable.
EXHIBIT 6 - Consent of Bankers Trust Company required by Section
321(b) of the Act. - Incorporated herein by reference
to Exhibit 4 filed with Form T-1 Statement,
Registration No. 22-18864.
EXHIBIT 7 - A copy of the latest report of condition of Bankers
Trust Company dated as of September 30, 1996.
EXHIBIT 8 - Not Applicable.
EXHIBIT 9 - Not Applicable.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, a corporation organized and
existing under the laws of the State of New York, has duly caused this
statement of eligibility to be signed on its behalf by the undersigned,
thereunto duly authorized, all in The City of New York, and State of New
York, on the 25th day of November, 1996.
BANKERS TRUST COMPANY
By: S/Jenna Kaufman/
-----------------
Jenna Kaufman
Vice President
<PAGE>
Exhibit 7
<TABLE>
<S> <C> <C>
Legal Title of Bank: Bankers Trust Company Call Date: 9/30/96 ST-BK: 36-4840FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-1
City, State ZIP: New York, NY 10006 11
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS SEPTEMBER 30, 1996
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, reported the amount outstanding as of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<S> <C>
________________
| C400 |
Dollar Amounts in Thousands | RCFD Bil Mil Thou |
ASSETS | / / / / / / / / / / / / / / / / / |
1. Cash and balances due from depository institutions (from Schedule RC-A): | / / / / / / / / / / / / / / / / / |
a. Noninterest-bearing balances and currency and coin(1) ............... | 0081 809,000 |1.a.
b. Interest-bearing balances(2) ........................................ | 0071 4,453,000 |1.b.
2. Securities: | / / / / / / / / / / / / / / / / / |
a. Held-to-maturity securities (from Schedule RC-B, column A) .......... | 1754 0 |2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)......... | 1773 4,133,000 |2.b.
3. Federal funds sold and securities purchased under agreements to resell in | / / / / / / / / / / / / / / / / / |
domestic offices of the bank and of its Edge and Agreement subsidiaries, | / / / / / / / / / / / / / / / / / |
and in IBFs: | / / / / / / / / / / / / / / / / / |
a. Federal funds sold .................................................. | 0276 5,933,000 |3.a.
b. Securities purchased under agreements to resell ..................... | 0277 413,000 |3.b.
4. Loans and lease financing receivables: | / / / / / / / / / / / / / / / / / |
a. Loans and leases, net of unearned income (from Schedule RC-C) | / / / / / / / / / / / / / / / / / |
RCFD 2122 27,239,000 | / / / / / / / / / / / / / / / / / |4.a.
b. LESS: Allowance for loan and lease losses.... RCFD 3123 917,000 | / / / / / / / / / / / / / / / / / |4.b.
c. LESS: Allocated transfer risk reserve ....... RCFD 31280 0 | / / / / / / / / / / / / / / / / / |4.c.
d. Loans and leases, net of unearned income, | / / / / / / / / / / / / / / / / / |
allowance, and reserve (item 4.a minus 4.b and 4.c) ................. | 2125 26,322,000 |4.d.
5. Assets held in trading accounts .......................................... | 3545 36,669,000 |5.
6. Premises and fixed assets (including capitalized leases) ................. | 2145 870,000 |6.
7. Other real estate owned (from Schedule RC-M) ............................. | 2150 215,000 |7.
8. Investments in unconsolidated subsidiaries and associated companies | / / / / / / / / / / / / / / / / / |
(from Schedule RC-M) | 2130 212,000 |8.
9. Customers' liability to this bank on acceptances outstanding ............. | 2155 577,000 |9.
10. Intangible assets (from Schedule RC-M) ................................... | 2143 18,000 |10.
11. Other assets (from Schedule RC-F) ........................................ | 2160 8,808,000 |11.
12. Total assets (sum of items 1 through 11) ................................. | 2170 89,432,000 |12.
| ____________________________________ |
</TABLE>
__________________________
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
<PAGE>
<TABLE>
<S> <C> <C>
Legal Title of Bank: Bankers Trust Company Call Date: 9/30/96 ST-BK: 36-4840FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-2
City, State ZIP: New York, NY 10006 12
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
</TABLE>
SCHEDULE RC--CONTINUED
<TABLE>
<S> <C>
_____________________________
Dollar Amounts in Thousands | / / / / / / / / Bil Mil Thou |
|_______________________________________|_
LIABILITIES | / / / / / / / / / / / / / / |
13. Deposits: | / / / / / / / / / / / / / / |
a. In domestic offices (sum of totals of columns A and C from Schedule RC-E, part I) | RCON 2200 9,391,000 |13.a.
(1) Noninterest-bearing(1) ...................RCON 6631 2,734,000.......... | / / / / / / / / / / / / / / |13.a.(1)
(2) Interest-bearing ........................RCON 6636 6,657,000.......... | / / / / / / / / / / / / / / |13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule | / / / / / / / / / / / / / / |
RC-E part II) | RCFN 2200 23,385,000 |13.b.
(1) Noninterest-bearing .....................RCFN 6631 654,000 | / / / / / / / / / / / / / / |13.b.(1)
(2) Interest-bearing ........................RCFN 6636 22,731,000 | / / / / / / / / / / / / / / |13.b.(2)
14. Federal funds purchased and securities sold under agreements to repurchase in | / / / / / / / / / / / / / / |
domestic offices of the bank and of its Edge and Agreement subsidiaries, and in IBFs:| / / / / / / / / / / / / / / |
a. Federal funds purchased ...................................................... | RCFD 0278 3,090,000 |14.a.
b. Securities sold under agreements to repurchase ............................... | RCFD 0279 99,000 |14.b.
15. a. Demand notes issued to the U.S. Treasury ....................................... | RCON 2840 0 |15.a.
b. Trading liabilities .......................................................... | RCFD 3548 18,326,000 |15.b.
16. Other borrowed money: | / / / / / / / / / / / / / / |
a. With original maturity of one year or less ................................... | RCFD 2332 17,476,000 |16.a.
b. With original maturity of more than one year ................................. | RCFD 2333 2,771,000 |16.b.
17. Mortgage indebtedness and obligations under capitalized leases .................... | RCFD 2910 31,000 |17.
18. Bank's liability on acceptances executed and outstanding .......................... | RCFD 2920 577,000 |18.
19. Subordinated notes and debentures ................................................. | RCFD 3200 1,228,000 |19.
20. Other liabilities (from Schedule RC-G) ............................................ | RCFD 2930 8,398,000 |20.
21. Total liabilities (sum of items 13 through 20) .................................... | RCFD 2948 84,772,000 |21.
| / / / / / / / / / / / / / / |
22. Limited-life preferred stock and related surplus .................................. | RCFD 3282 0 |22.
EQUITY CAPITAL | / / / / / / / / / / / / / / |
23. Perpetual preferred stock and related surplus ..................................... | RCFD 3838 500,000 |23.
24. Common stock ...................................................................... | RCFD 3230 1,002,000 |24.
25. Surplus (exclude all surplus related to preferred stock) .......................... | RCFD 3839 527,000 |25.
26. a. Undivided profits and capital reserves ......................................... | RCFD 3632 3,017,000 |26.a.
b. Net unrealized holding gains (losses) on available-for-sale securities ......... | RCFD 8434 (16,000) |26.b.
27. Cumulative foreign currency translation adjustments ............................... | RCFD 3284 (370,000) |27.
28. Total equity capital (sum of items 23 through 27) ................................. | RCFD 3210 4,660,000 |28.
29. Total liabilities, limited-life preferred stock, and equity capital (sum of items | / / / / / / / / / / / / / / |
21, 22, and 28).................................................................... | RCFD 3300 89,432,000 |29.
|__________ ___________ |
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best
describes the most comprehensive level of auditing work performed for the bank Number
by independent external auditors as of any date during 1995........................ | RCFD 6724 N/A | M.1
1 = Independent audit of the bank conducted in accordance 4 = Directors' examination of the bank performed by other
with generally accepted auditing standards by a certified external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit work
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
</TABLE>
______________________
(1) Including total demand deposits and noninterest-bearing time and
savings deposits.
